Why retailers and retail brands should get ready for the GS1 Digital Link 2D barcode right now

Making digitally connected products the global standard

Under the change, barcodes will be upgraded from the traditional 1D barcode with its global trade item numbers (GTINs) of 14 numbers, to a unique 2D barcode including the GTIN, as well as an important amount of additional embedded data that retailers and consumers can utilize.  Being the first time that digitally connected products and dynamic or serialized data will be established as a global standard, the change will mark a critical shift in product identification. As a major step towards making significantly more product information accessible to the entire supply chain, it also presents key opportunities for retail. 

The GS1 Digital Link is not the only new standard with the potential to provide added benefits to retail businesses. Anticipated to come into effect in 2027, the EU’s Digital Product Passport will transform how retailers, manufacturers, and other businesses share product information across the supply chain, particularly concerning sustainability. The Digital Product Passport is in effect a digital twin of a product linked to the physical product through a QR code, barcode, or other tagging solution to bring together and share key product data from all stages of the supply chain.

Seamless connectivity

Advancing the fresh food market and beyond

So, what does the emergence of the 2D code as standard mean for the FMCG market and their retailers? For fresh food products, particularly those with a short shelf life, 2D codes offer better answers to problems such as managing pricing in response to changes in demand, reducing waste, accelerating the product recalls process, and combatting theft. Moving beyond the limitations of static information, the use of 2D codes enables the brand to add more accurate best-before or eat-by dates, right down to the individual unit number level. Yet another advantage of the dynamic nature of the GS1 Digital Link is more adaptable product branding, for products that are liable to change in composition, such as wine. This potential for the late-stage customization of information on the label through Its 2D code will deliver easier compliance achievement and widen the array of information given provided to the consumer.

All types of businesses can take advantage of the GS1 Digital Link to reimagine their approach to product packaging. Going beyond the limitations of having to add the full ingredient list in multiple languages onto packaging, in the future, companies could potentially benefit from increased design space for bolder and more sophisticated branding. This would enable them to optimize their SKU inventory, even going so far as to remove the entire packaging material, if appropriate and compliant. It would also allow companies to reduce their packaging’s environmental impact, optimize stock levels, possibly save space, and thus respond even more quickly to changes in demand.

An evolution in product information

Retailers and manufacturers are constantly hampered by complex data management processes and dependence on centralized systems. Depending on the scanning device, the 2D code addresses these challenges by enabling one single QR code to deliver a wide range of information, giving each product a unique identifier. As a result, consumers can quickly and easily access nutrition tables, expiry dates, recall warnings, and promotional offers on their smartphones. Plus, with only one QR code, measuring a minimum of 2cm x 2cm, required to ensure scannability, companies benefit from accurate product information available at every stage of the supply chain and in as many languages as required. Not only does all of this mean that consumers access much more relevant data more easily in a matter of seconds with any smartphone, but retailers can authenticate the products, trace their origin, better manage stock levels, and adapt and update them more accurately in response to changing market requirements.

From “deceptive” to “non-deceptive” counterfeit products, many retailers are concerned about the potential impact of fake products. Once again, the standardization of 2D codes signals an important shift in tackling this problem. The precise, unique product identifier they provide increases companies’ control and visibility at every stage of the supply chain.

Rethinking product recalls

Slow and costly product recalls can be transformed by the added information and more precise tracking provided by 2D codes. 2D barcodes benefit US-based FMCG producers and manufacturers in yet another way because they enable the Food and Drug Administration’s (FDA) Final Rule on Requirements for Additional Traceability Records for Certain Foods, also known as the Food Traceability Final Rule. This regulation requires companies to be able to trace the movement of certain fresh food products from fruit to fish at every stage of the supply chain. QR codes are recommended for ensuring a high level of traceability and to speed up the process of their localization from days to just hours. This improvement will potentially enable retail businesses to avoid contamination outbreaks and costly lawsuits, providing them with a higher level of protection.

2D codes are better for traceability than serialized 1D barcodes for several reasons. Most importantly, they ensure that key product and supply chain information is easily accessible outside of the company’s production systems, for companies and their customers. They also allow for the use of the smallest possible print size, enabling the inclusion of a greater volume of information on the packaging. Another advantage of 2D codes over serialized 1D barcodes is that, even when partially damaged, they can still be read.

Endless branding possibilities for consumer engagement

Positive customer perception is vital to every retailer. The 2D barcode delivers a valuable step forward in traceability for many types of companies. This end-to-end visibility ensures greater defense against the counterfeiting of products, helping to maintain brand integrity and customer loyalty and protect profit margins.

2D codes also offer new and exciting ways for retail brands to advance brand awareness and most importantly ensure authentication and improve visibility. Their value in connecting physical products with digital content means companies can create product marketing content that is both broader in scope but also more precisely targeted to align with the interests and tastes of specific demographics.

For retail brands, the dynamic nature of 2D codes presents endless branding and B2C marketing possibilities, whether it is the use of a single URL that takes the consumer to a carefully curated website showcasing every stage of the product’s development or delivering post-purchase personalized content to build on a customer’s emotional investment in a brand. At a time when consumers are making their purchasing choices more carefully than ever, the ability to connect meaningfully with them both inside and outside the retail environment is hugely valuable.

Preparing for 2D codes—next steps for retailers

For all retailers, a key priority must be updating their point of sale (POS) and mobile POS infrastructure so that their systems are capable of reading and processing 2D codes and their associated attribute data. Retailers must also look at ensuring they have the technology in place to print and code individual items in 2D and with dynamic information at high speeds. Alongside this, companies must ensure they can leverage all the data available by ensuring that their inventory, supply chain management, and merchandising systems are fully integrated.

Roll-out of both the GS1 Digital Link and the Digital Product Passport are just a couple of years away. By taking the right steps now, retailers and retail brands can fully maximize the benefits of the 2D barcode.